reports
- Chris Wickham
On track to scale new revenue heights
UPGS’s achievement of 13.7% revenue growth in the first half of FY2022 and anticipation of full year growth in line with current expectations implies close to a 20% advance in sales revenue this financial year. Moreover, growth sustainability should be supported by a combination of effective brand management and enlarged distribution capacity. The company should also be credited with its ability to record steady revenue growth despite supply chain headwinds. There is now cautious optimism that t...
- Chris Wickham
Brand strength underpins strong growth outlook
UPGS’s combination of strong brands, targeted distribution channels and demonstrable success in M&A augurs well for sustainable growth. Moreover, the company’s track record in coping with disruptions associated with Covid19 should give investors confidence in senior management’s ability to handle any ongoing logistics problems associated with both international shipping and domestic haulage. Supermarkets and Online Channels continue to grow most quickly with advances of and 32.3% and 23.2% resp...
- Chris Wickham
Another year of good growth delivered
UPGS’s pre-close FY2021 trading statement confirmed a strong end to the financial year with most key financial measures beating market expectations. Moreover, FY2022 appears to have started well despite ongoing headwinds. Sustainable growth is built on a focused brand portfolio (which now includes the whole Salter range), stronger distribution online and into supermarkets, plus further international progress. We upgrade our FY2022 profit forecasts. Better than expected sales revenue, EBITDA, ...
- Chris Wickham
UPGS acquires UK’s oldest housewares brand
UPGS’s announcement that it is acquiring Salter, the UK’s oldest housewares brand and notable for its scales, is a major positive step. The acquisition not only creates enlarged, outright ownership of a key brand and expands UPGS’s kitchen and bathroom offering, but also establishes a foothold in health & lifestyle. Moreover, the deal appears attractively priced for UPGS shareholders. Salter’s impact on UPGS’s shares should be positive for two main reasons. First, the deal itself will result i...
- Chris Wickham
Broadening the scope for growth
UPGS’s success in online and supermarkets, combined with the ability of key brands to resonate with its end-customers’ desire for quality affordable homebased products, shows that the company is well positioned for further growth as the Covid19 pandemic eases. Moreover, the potential for more M&A and new geographies implies substantial headroom for future expansion. We upgrade our profit forecasts and fair value in this report. UPGS’s FY2021 half-year report, released today, re-confirms the £...
- Chris Wickham
Petra acquisition to enhance international business
Today’s announcement that UPGS has acquired German electrical kitchen brand Petra is a continuation of a strategy which has turned UPGS into a highly successful developer of brands. Petra not only adds to the company’s German offering, but further ahead will enhance the company’s international range of quality and affordable “feel good” household products. Brand management skills remain a key driver of UPGS’s ability to continue to grow at a brisk pace in both the online and supermarket channe...
- Chris Wickham
Brands positioned for sustainable growth
A strong performance from the group’s largest brand, Beldray, further growth in the online and supermarket channels, and the ability to offset increased Chinese shipping rates were key features of UP Global Sourcing’s FY2021 trading statement. Moreover, the company’s financial position continues to improve with both broadly expected year end net debt and ample facilities headroom. We raise both our sales and profit forecasts in this report. The valuation of UPGS remains undemanding. Based on...
- Chris Wickham
Beldray leads the way
Beldray’s strong performance and better than expected online and supermarket sales were the salient features of UPGS’s latest unscheduled trading statement. With continuing momentum in the order book and increasing resilience due to balanced distribution across its trading channels, we upgrade our full year FY2021 forecasts and argue that, at the current price of 98p, the shares would have to rise a full 50% to reach our 150p fair value. UPGS anticipates that underlying EBITDA in FY2021 will be...
- Chris Wickham
Ultimately, there’s brand value
What could have been a “year of living dangerously” for UPGS was a year of living positively. Today’s headline preliminary FY2020 results contain few surprises, so investors should in our view reflect on the company’s relatively upbeat stance for the near-term outlook. Despite new Covid measures, a combination of effective brand management, new distribution channels and geographical expansion augurs well for sustainable revenue growth. We maintain our assessment of fair value for UPGS’s share...
- Chris Wickham
Brand strength reaps rewards
Better than expected sales revenue and profits, substantial growth in the online business, robust finances and a strong start to FY2021 were salient features of UPGS’s FY2020 year-end trading statement, which was released today. Despite Covid-19 challenges, their brand portfolio and distribution strength show clear, positive momentum: evidenced by resuming dividends and repayment of furlough monies. Our valuation metrics suggest scope for more upside as revenue and earnings grow with interna...
- Chris Wickham
Brisk growth rate supports higher valuation
The ongoing pandemic only serves to underline business models that are robust, and those that aren’t. This morning’s trading update from UPGS puts them firmly in the winners’ category. As the company approaches the final weeks of FY2020, it not only reports “better than expected progress†against an uncertain business backdrop, but also that revenue and key profit measures for the year should be ahead of current market expectations. Furthermore, online as a portion of total business ...
- Chris Wickham
Satisfying customer demand
UPGS released an unscheduled trading statement this morning which confirms better numbers for FY2020 sales revenue, profitability and net debt, than previously envisaged when the company reported its interim results on 30th April. A commitment to being flexible enough to ensure employee safety while satisfying customer demand is clearly working well. Accordingly, we make positive adjustments to our own forecasts. UPGS’s shares performed well in the past two months: since end-March they ral...
- Chris Wickham
Benefits of underlying strengths
UPGS’s interim results included a number of positive outcomes for underlying sales growth, profits and free cash flow in the half. Despite some Covid-19 related setbacks since then, UPGS appears well placed to emerge positively from the current pandemic crisis. In particular, the business benefited from underlying strengths built up over time. Moreover, we welcome the greater importance of UPGS’s online pillar in a post Covid-19 environment. This year will see a sharp reduction in both s...
- Chris Wickham
Coronavirus disrupts H2 sales revenue
Ultimate Products (UP Global Sourcing Holdings PLC), which in recent half-years significantly accelerated its trading momentum, looks set to suffer from coronavirus related disruption to its business in the second half. The company has made a trading update announcement this morning and as a result we are withdrawing our financial forecasts until there is greater certainty.
- Chris Wickham
EBITDA margin sustains profit growth
UPGS reconfirmed FY2020 profit guidance in a trading statement released today. While FY2020 sales guidance has been reduced, adjusted EBITDA margins will be slightly higher at 8.1% compared with 7.9% envisaged previously. Group banking facilities, that gave £13.2m headroom at end-January were extended until 2024. With the majority of its manufactured product sourced from China, UPGS’s Board is closely monitoring coronavirus developments and highlights that the extension to the Chinese ...
- Chris Wickham
Execution strength fuels growth
Excellent execution underpinned a strong recovery year for UPGS in FY2019, which augurs well for future growth. Headline results confirm the company’s 9th September trading statement. Detailed sales data reflect the company’s ability to enhance core domestic growth with strong progress in both international and online. In our view, growth should remain positive in FY2020. UPGS’s preliminary results lap last year’s announcement that was the start of the company consistently reporting ...
- Chris Wickham
Positive End to FY2019 Confirmed
UPGS’s pre-close FY2019 trading statement confirmed a previously stated view on 17th July that FY2019 would end on a positive note. The company will announce preliminary full year results on 5th November 2019. Ahead of then, underlying trends remain firmly positive. We upgrade FY2020 forecasts too. Sales revenue in FY2019 grew by 40.8% to £123.3m. The company’s most recently guided range was £121.5m to £122.0m. EBITDA is expected to be 53.4% higher at £9.9m compared with our £9.7m...
- Chris Wickham
Further positive surprises – growing well!
UPGS looks to end FY2019 on an extremely positive note. Its trading statement issued today indicates that sales revenue will be above both our own and market expectations. Moreover, profits (EBITDA and pre-tax) should also beat our estimates. With sales growth outperforming across the group, management strategy appears on track. After recent share price weakness, valuation metrics look supportive for the share price. In terms of valuation, we remain firmly of the view that 100p is a reasonab...
- Chris Wickham
Good reasons for optimism
UPGS’s half-year results included a 47.3% rise in underlying pre-tax profits, bolstered significantly by a 21% normalised increase in sales revenue. An optimistic tone on H2 sales prompts us to raise our full year forecasts and that has positive implications for both the group’s financial strength and valuation. UPGS translated brisk sales growth into strong profit gains in its first half. Underlying EBITDA increased by 48.4% to £6.6m, underlying pre-tax profits by 47.3% to £5.9m and adj...
- Chris Wickham
Underlying H1 sales soar 21% - Game on!
UPGS’ latest trading statement confirms the group’s improved sales momentum. Moreover, with all four growth pillars performing positively, FY2018’s setback can be seen as exceptional, rather than the norm. We remain positive on the outlook for both UPGS’ sales and profitability, which is in our view available to investors at a very attractive share price valuation. UPGS’ financials and valuation tend to support a positive investment view. We take this opportunity to raise our FY201...
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